Strong Uptick In Paid-Search Ads, Buying Power

Retail marketers gearing up for Black Friday spent more of their digital ad budget on paid-search and digital advertising in Q4 2011, compared with the year-ago quarter. During the first half, investments in paid-search spend jumped 31% and display advertising rose 27%, compared with the first half of Q4 2010. 

The obvious reasons for the increase point to more consumers searching, clicking and buying goods and services online, as well as an uptick in use of mobile phones and tablets. Consumers continue to become more confident about spending online.

Consumer behavior points to a 120% uptick in transactions, along with a 52% rise in revenue just ahead of the peak holiday shopping season. Revenue per click remains steady with a slight increase of 5.5%, which points to the ability to monetize advertising as rates increase. Search ads are performing better with a 52% increase in conversion rate, which significantly tops last year’s growth of 28.7%.

IgnitionOne President Roger Barnette said revenue, conversion rates and the number of orders rose, but marketers spent more on search and display. Despite the increase in spend, the outcome could translate into more profit, compared with years past. "It could mean good things this quarter for retailers and advertisers," he said.



Signs point to increased spending throughout the quarter, not just in the beginning, he said. More consumers searching on mobile devices also prompted retail marketers to spend more. Paid search clicks jumped 355% compared with Q4 2010. In fact, research firm eMarketer estimates that by the end of this year, more than 33 million Americans will use a tablet device at least monthly, up 158.6% compared with the prior year.

Growth will slow to double digits beginning in 2012, but the number of users will rise to nearly 90 million, or 27.7% of the U.S. population, by 2014. Usage of tablets will rise faster among Caucasians, compared with other races and ethnicities, growing from 60.6% of total users this year to 65.8% by 2014, according to eMarketer.

This IgnitionOne report tracked more than 5 billion impressions and 75 million clicks on Google and Yahoo/Bing search networks, Google AdEx, and other display networks from Oct 1, 2010 to Nov 13, 2011 across the company's retail clients.

1 comment about "Strong Uptick In Paid-Search Ads, Buying Power".
Check to receive email when comments are posted.
  1. Joe Cibula from InverSearch, November 23, 2011 at 6:26 a.m.

    The news media really ought to step up and start talking about the realities of paid search in that it's nothing more than the paultry 1-3% people have been getting since time began. Take it a step further and it's white collar crime. Click fraud. Irrelevant and misleading search results. Unwanted clicks. Outdated information. The fact that leads to all this, and more. Do you like pay per click? I've never met anyone who has.

Next story loading loading..